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March 28, 2023


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Behind Chinese covid protests, economic worries simmer among youth

5 min read

But they also reflected another source of tension Beijing is nervous about: growing economic frustration among China’s younger generation.

The rare public displays of discontent, which included protests on university campuses, came as authorities have struggled to put a floor under the economy, which is on track to expand at the slowest pace in more than four decades this year, apart from 2020, the year when Covid first hit.

The outlook is particularly gloomy for young Chinese. The official unemployment rate for urban youths between 16 and 24 is hovering around 18%, near an all-time high.

More than 11.58 million students, a record, will graduate next summer. Yet many jobs for young people and college graduates—especially in China’s internet, education and service sectors—have disappeared because of Covid controls and the government’s regulatory crackdowns on private companies over the past year.

In Shanghai, some protesters on Saturday night yelled, “for three years, we don’t have jobs!” according to a participant. On Douban, a popular social media platform, more than 52,000 people have joined a support group formed last year called, “Fresh Graduate Anti-Anxiety Group,” in which they share laments about the job market.

“When growth slows down and people have less money and a less bright future to look forward to, they are less willing to put up with other problems,” said Nancy Qian, an economics professor at Northwestern University.

Such frustrations raise the urgency for Xi Jinping and other Chinese leaders to reignite growth soon, lest the worries fester and feed into more unrest. But fixing the economy will be hard at a time when global demand for Chinese exports is weakening—especially if Covid cases spread across China this winter, as many experts predict.

“What’s really dangerous for Xi is if people start to question the leadership’s competence,” said Mark Williams, chief Asia economist at Capital Economics. “The endless cycle of testing and quarantines required by the zero-Covid policy has put the spotlight on that.”

China’s State Council Information Office, which handles foreign media inquiries, didn’t immediately respond to a request for comment.

Youths with economic complaints have long been a concern for China’s ruling Communist Party, which resorted to a bloody crackdown on student protesters at Tiananmen Square in 1989. Economists widely attribute inflation, which rose by 18% that year, as a key factor that fueled that unrest.

The current protests began as memorials for those who died from a fire in Urumqi last week and quickly morphed into criticism of China’s Covid policy, and the way it has disrupted people’s lives, including forced quarantines.

Other concerns have also emerged. On Sunday, hundreds of students from Tsinghua University, an elite school in Beijing, chanted “Democracy and rule of law!” on campus. Protesters across the country held sheets of blank paper to express anger at constraints on free expression. In Shanghai, some called for Mr. Xi to step down.

Still, economic concerns have formed a backdrop for the protests. While some of China’s growth slowdown this year was due to factors outside of Beijing’s control, much of the weakness stems from policy decisions Beijing made, making Chinese leaders an easier target for young people’s ire.

The government’s campaign to contain Covid led to frequent lockdowns which eroded earnings for companies, dented consumer spending, and led to spikes in goods costs due to logistics snafus.

At the same time, government efforts to purge excess debt in the property market and bring risk-taking private companies to heel deterred investment and led to mass layoffs. Frustratingly for many young people, the government’s property market clampdown so far hasn’t brought prices down to an affordable level in many places, even as it destabilized some developers.

China’s gross domestic product is expected to grow by around 3% this year, only a notch above 2.2% growth in 2020 when the pandemic first hit Wuhan.

China’s top leaders have repeatedly said they want to stabilize the job market. They have used government stimulus and other tactics to bring down headline unemployment across all age groups to 5.5% in October from 6.1% in April.

However, economists say labor market pressures are likely to persist for younger Chinese. Whenever growth slows in China, the pressure sometimes falls disproportionately on those trying to enter the job market, economists say, as some companies prefer to retain more-experienced workers, and others halt hiring due to the uncertain outlook.

The constant Covid testing and lockdowns have also pushed many service providers such as restaurants and travel agencies—which serve as major employers for young people—out of business.

Grim market conditions have led many people to try to avoid entering the job market.

In Hangzhou, Jiang Lin, an undergraduate student in accounting, said she was pressured by her parents to apply for graduate studies instead this year. More than 5.4 million people registered for exams to enter graduate schools next year, a record high and nearly double the 2.9 million applicants in 2019.

“But I’m not sure if it’d be any easier for me to find a job in two years,” she said.

Jiang Huiwen, a third-year graduate student in philosophy at a university in Beijing, abandoned applying for further studies due to what she described as an oversupply of people with doctorate degrees. This fall, she spent three months looking for a job and sent out more than 80 copies of her résumé, receiving only one offer to work as an intern at an autonomous vehicle company.

She plans on quitting next month given the low chance of getting a permanent position.

“When reality doesn’t match expectations, it’s hard not to have a meltdown,” said 23-year old Ms. Jiang, who estimates she spent about two months on average each year under lockdown over the past three years.

Unlike their parents, Chinese 20-somethings grew up in two decades of prosperity and largely believed that their efforts in school would pay off, said Ms. Qian of Northwestern University. With growth slowing so much this year, the lack of visible payoffs has “added up to an accumulation of frustration and anger.”

Vivien Wei, a 24-year old studying literature at a university in Shanghai, is looking for an entry-level editing job in her hometown in southern China, because she’s worried about her ability to afford rent and overall living costs in Shanghai.

“I heard from other students that it’s the toughest year when it comes to finding jobs,” she said. “I have kind of given up for now.”

The Urumqi fire and protests that occurred over the weekend stirred her. She said couldn’t stop reading about the protests during the past three days, even though she didn’t dare to join them.

“Individual interests will be sacrificed in the face of a powerful state apparatus,” said Ms. Wei. “Like many of my friends, we feel powerless about what’s going on.”

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